House GOP, Senate Dems unveil rival debt-ceiling plans

With the clock ticking toward the Aug. 2 deadline, details of the two very different plans emerged. Significant savings in the House GOP plan would be squeezed for government entitlement programs like Medicare and Medicaid, while the Senate Dems' approach would leave Medicare unchanged.

The Washington Post: "House and Senate leaders formally unveiled dueling backup plans Monday afternoon to raise the federal debt limit after a weekend of intense negotiations failed Sunday to break a partisan impasse that threatens to throw the government into default next week" (Montgomery and Kane, 67/25).

The New York Times: "House Republican leaders pushed for a vote Wednesday on a two-step plan that would allow the federal debt limit to immediately be raised by about $1 trillion and tie a second increase next year to the ability of a new joint Congressional committee to produce more deficit reduction. But top Senate Democrats called the proposal a "non-starter" and said they would advance their own plan to reduce the deficit by $2.7 trillion and raise the debt ceiling until after next year's elections, saying it met the conditions that Republicans had laid down during the ongoing debt fight" (Hulse, Steinhauer and Calmes, 7/25).

CNN: "With both sides still at an impasse on a debt deal to raise the nation's debt limit by Aug. 2, House Speaker John Boehner is moving forward with a new House GOP plan that would aim for roughly $3 trillion in cuts and raise the debt ceiling in two stages. According to two senior House GOP aides, the new legislation would initially cut $1.2 trillion in discretionary spending through cuts in government programs and caps on spending over the next 10 years. If these caps aren't reached, the plan would force across the board spending cuts. If Congress exceeds caps on spending, cuts will be triggered across the board. ... The House Republican plan also sets up a 12 member bipartisan "joint committee for deficit reduction" which would be given broad authority and instructed to come up with $1.6 to $1.8 trillion in additional savings. ...  The committee could include entitlement reforms, tax reforms, and further discretionary spending cuts to reach its deficit reduction target" (Walsh, 7/25).

Politico: "Speaker John Boehner's two-step plan to raise the debt ceiling by upwards of $2.5 trillion would require the White House to accept much deeper spending cuts than he was negotiating only last week with President Barack Obama. ... Two installments on the debt increase are anticipated. ... The first debt limit increase of between $900 billion to $1 trillion would be accompanied by strict discretionary spending caps designed to achieve 10 year savings of $1.2 trillion from annual appropriations bills. The second installment of up to $1.6 trillion would be contingent on first achieving $1.8 trillion more in savings largely from government benefit programs and entitlements such as Medicare and Medicaid" (Rogers, 7/25).

The Wall Street Journal: This panel "would be given a broad mandate, but would probably focus on large entitlement programs such as Medicare, Medicaid and Social Security as well as overhauling the tax code. The aides said the framework of the mandate wouldn't include any tax increases, although the committee of lawmakers wouldn't be prohibited from raising revenue as part of the tax-code overhaul. The panel would have 12 members—three from each party in the House and Senate. A majority of its members would have to approve its recommendations to trigger votes in the House and Senate. It would have a Nov. 23 deadline to report back to the full Congress, which would then have to vote on the findings by Dec. 23" (Boles and Bendavid, 7/25). 

CBS Political Hotsheet: "Senate Democrats unveiled a plan to raise the debt ceiling Monday that abandoned President Obama's call for revenue increases as part of a deal, putting forth a plan they said would cut spending by $2.7 trillion. The plan would include a $1.2 trillion reduction in both defense and non-defense discretionary spending. It also counts $1 trillion in spending cuts from winding down the cost of the wars in Iraq and Afghanistan, something critics say should not count in the total savings. ... The Democratic plan would not make cuts to Social Security, Medicare and Medicaid. ... It would save an additional $400 billion through interest savings, both from discretionary spending cuts and winding down the wars, and create a bipartisan committee to seek out future savings (Montopoli, 7/25).

MarketWatch: "Sen. Harry Reid on Monday unveiled his plan to increase the debt ceiling. ... . Saying the U.S. is 'about to go over the cliff,' Senate Democratic Leader Reid unveiled a plan to cut $2.7 trillion from the deficit without changing Medicare or raising taxes" (Schroeder, 7/25).

USA Today: "The White House is endorsing the debt reduction plan put up Senate Democratic leader Harry Reid over the one from Republican House Speaker John Boehner" (Jackson, 7/25).

Los Angeles Times: "The White House has staunchly refused the two-step process, saying the nation cannot risk the fiscal turmoil of another congressional debate over raising the debt ceiling, especially as the 2012 election season approaches" (Mascaro, 7/25).